Southwest orders 58 Boeing B737-800NG's

Southwest orders 58 Boeing B737-800NG's

2016 01 22

2016 01 22

"We have increased our future aircraft delivery schedule to support our recent decision to accelerate the retirement of our [737] Classic fleet to no later than mid-2018," says Southwest chief executive Gary Kelly. "This decision is expected to reduce operating costs over the acceleration period and improve the customer experience with better on-time performance and wi-fi-equipped 737 aircraft, with a manageable increase in our capital spending."

Southwest is expected to discuss the order in greater detail in an earnings call later today. It says that the revised delivery schedule will increase its aircraft capital commitments by $400 million after 2015.

The airline ended 2015 with a fleet of 704 aircraft, after taking delivery of 19 new 737-800s and 24 pre-owned 737-700s. The Dallas-based carrier also retired four 737 Classics.

Southwest previously planned to retire its Classic fleet no later than 2021 and says the accelerated timeline to mid-2018 has created a need for replacement capacity.

A revised fleet plan shows that Southwest expects to take delivery of 36 737-800s this year, 35 in 2017 and 18 in 2018. In addition, it will take delivery of 17 737-700s this year, 14 737-700s in 2017 and another four in 2018. Southwest's first 737 Max 8 will be delivered in 2017.